At nine petrol pumps, including six in Pune cantonement, one in Khadki and two in Dehu Road cantonment area, petrol prices will come down by Rs 2 from next week. This follows price correction by oil companies in view of the fact that LBT (Local Body Tax) on petrol has been withdrawn in cantonment areas.

On Friday, Pune Municipal Commissioner Kunal Kumar forwarded a letter to the three oil companies – Hindustan Petroleum Corporation Limited, Bharat Petroleum Corporation and the Indian Oil Corporation urging them to exclude collection of LBT from cantonment areas.

“The oil companies have a system of central collection… we have asked them to exclude petrol pumps which fall in the cantonment areas from their system and collect LBT only within the corporation limits,” said Kumar. He said the letter issued to the oil companies would enable them to reduce the price of petrol in those areas as LBT would not be applicable on petrol.

District Collector Saurabh Rao had called for a meeting of the oil company officials last week as well as Pune Petrol Association Dealers and cantonment officials.

Ali Daruwalla of the association said once the oil companies receive the letter, they would forward it to the Industrial Pricing Committee and the prices would come down in cantonment petrol pumps. “In all likelihood, the price will be reduced by Rs 2. It means that the petrol prices at these pumps will be at Rs 76.75 paise and diesel will reduce by Rs 1.50 paise which means the rate would be Rs 64.61 paise,” he said.

Officials at the three oil companies said the firms were closed on weekends and would initiate action on Monday. “Once we get the letter, our pricing committee will decide the rate,” said an official.

The cantonments had never given a go-ahead to collect LBT. While oil companies maintained they were paying LBT to the civic body as per its directives, dealers argued that according to the 1955 government resolution, petrol and diesel fall under the ambit of the Essential Commodities Act and LBT cannot be levied on these fuels. At present, the petrol pumps are already paying 15 per cent excise, 25 per cent excise value added tax, two per cent octroi and Re 1 education cess on every litre of petrol.